"Such an outcome should put to rest any remaining doubt about China escaping a hard landing and sailing smoothly through the troubled global waters," Dariusz Kowalczyk of Credit Agricole CIB in Hong Kong said in an email.

Japan's Nikkei 225 soared 2.5 percent to 10,875.16, recouping all of Thursday's losses and more as the yen slipped against the dollar. The dollar rose above the 90-yen line for the first time since June 2010 as expectations intensified that the Bank of Japan will take steps to ease credit next week, Kyodo News Agency reported.

Analysts say they don't expect to see new stimulus measures or radical policy changes by the new Chinese leadership, especially after what Friday's figures showed.

"They are going to continue to make sure growth continues but at a sustainable rate and part of that for the new leadership is to make sure money isn't wasted on corruption or on roads that go nowhere. They are trying to be prudent in their policies," said Andrew Sullivan, a Hong Kong-based market analyst.

Investors became more optimistic Thursday after the U.S. Commerce Department issued a strong report on housing starts for December. Builders broke ground on houses and apartments at a seasonally adjusted annual rate of 954,000 - more than 12 percent higher than November.

Unemployment figures were a further sign of economic recovery. The U.S. government said the number of Americans seeking unemployment aid plummeted to a five-year low last week.

"US economic data continued to show steady and gradual growth, and that gave a fresh boost to market sentiment," said Gary Yau of Credit Agricole in a market commentary.

Wall Street stocks rose, but the rally was held back by earnings reports from two of the country's biggest banks. Both Citigroup and Bank of America fell after disappointing the market with their fourth-quarter earnings reports.

Benchmark oil for February delivery was down 17 cents to $95.32 per barrel in electronic trading on the New York Mercantile Exchange. The contract gained $1.25 to finish at $95.49 a barrel. That was the highest close for crude on the Nymex since Sept. 17 and a result of the positive economic reports out of the U.S.

In currencies, the euro rose to $1.3388 from $1.3384 late Thursday in New York. The dollar rose to 90.07 yen from 89.97 yen.